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The European Journal of Health Economics (2020) 21:813–814

https://doi.org/10.1007/s10198-019-01154-y

COMMENTARY

Reply tothecomment on“Trends inrates oforthopedic surgery

inGermany: thegood, thebad, theugly.”

NatalieBaier1· Lisa‑MarieSax2· LeonieSundmacher3

Published online: 21 January 2020

We wish to thank the Editor for giving us the opportunity

to respond to the points concerning the statistical specifi-

cation and the analytical approach raised by Prof. Afschin

Gandjour.

Gandjour criticizes that the dependent variable is not

defined. However, we described the dependent variable,

the number of hip replacements, knee replacements and

spine surgeries, comprehensively in the methodology sec-

tion in the subsection “data” on page 164. It is furthermore

pointed out that the dependent variable Y appears on both

sides of the Eqs.3 and 4 on page 168. This is true and it

is an approach to model spatial dependence (see analysis

section on page 167). The employed spatial Durbin model

includes a spatially lagged variable of the dependent vari-

able. The dependent variable for one district is in this case

affected by the dependent variable for the other districts. We

included the lagged variable as we assumed potential spillo-

ver effects caused by, for example, communication between

physicians of neighboring districts. Detailed information on

the modeling of spatial dependencies is given in Ward and

Gleditsch [1] and Elhorst [2]. In this context, the comment

that we used an OLS fixed effects model is not correct. Our

regression model is a spatial panel model combining the

Mundlak Model and the spatial Durbin model. The equation

is presented on page 168. This type of model allows to con-

trol for individual heterogeneity and spatial dependence.

Furthermore, the concern is raised that we might have a

problem with reverse causality, as “an increased volume of

surgical procedures in some hospitals may encourage other

providers to enter the market and offer these procedures as

well, thus causing more competition”. This refers to our

hypothesis that increased competition, measured among oth-

ers by the number of hospitals, is associated with increased

procedure volume. The number of hospitals is determined by

hospital planning which is done by the ministries of health at

the federal state level. Methods for planning differ between

the federal states. Regulation of hospital capacities is

planned on the basis of principles of need and performance

[3]. A closer look at the federal state of Berlin shows that

the hospital plan of 2010 was the binding basis until 2015.

The hospital plan for 2016 was developed in a 3-year plan-

ning process with the participation of relevant actors in the

hospital sector [4]. Only hospitals included in the hospital

plan are reimbursed by the sickness funds and receive capital

investments by the federal states [3]. Due to this regulation,

it is unlikely that other providers enter the market to offer

procedures for which we observe an increasing volume.

Finally, it is mentioned that the introduction and the

analysis are disconnected from the conclusion. According

to Gandjour’s understanding of our article, the analysis was

supposed to be about unnecessary surgeries (indication qual-

ity) and in the concluding section, specialization of hospitals

are discussed (procedural quality). We think that there might

be a misunderstanding regarding the aim of the analysis.

Based on the theory and empirical studies presented in the

introduction of our article, we hypothesized that the age- and

sex-standardized rates of surgical procedures are positively

associated with the degree of competition for these proce-

dures. Admitting patients for potentially unnecessary ser-

vices is listed as a potential strategy for hospitals to increase

the number of patients. We had to reject our hypothesis as

we found that with increasing market concentration, the rates

This comment refers to the article available at https ://doi.

org/10.1007/s1019 8-018-0990-2.

* Natalie Baier

[email protected]

1 Department ofHealth Care Management, Berlin Centre

forHealth Economics Research (BerlinHECOR), Technische

Universität Berlin, Str. des 17. Juni 135, 10623Berlin,

Germany

2 City University London, Northampton Square, Clerkenwell,

LondonEC1V0HB, UK

3 Department ofHealth Services Management,

Ludwig-Maximilians-Universität München, Schackstraße 4,

80539Munich, Germany

814 N.Baier et al.

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of hip and knee replacement rose. Specialization is discussed

as a potential reason for this result. The data set for the anal-

ysis was chosen to analyze trends and regional variation on a

nationwide level. Our aim was not to analyze the individual

quality of the procedures (indication or procedural).

Acknowledgements Open Access funding provided by Projekt DEAL.

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References

1. Ward, M.D., Gleditsch, K.S.: Spatial Regression Models. SAGE,

Los Angeles (2019)

2. Elhorst, J.P.: Applied spatial econometrics: raising the bar. Spat.

Econ. Anal. 5, 9–28 (2010). https ://doi.org/10.1080/17421 77090

35417 72

3. Busse, R., Blümel, M.: Germany: health system review. Health

System in Transition. 2014

4. Senatsverwaltung für Gesundheit, Pflege und Gleichstellung.

Krankenhausplan des Landes Berlin. (2016). https ://www.berli

n.de/sen/gesun dheit /theme n/stati onaer e-verso rgung /krank enhau

splan /. Accessed 12 Oct 2019

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